METIRIA TUREI to the Minister for the Environment: Ki Te Minita mō Te Taiao: Ka tukua e ngā paerewa e whakaarohia akehia nei mō te pai ake o te wai i roto i te pūhera Wai Mā, te kaha kē atu, te iti kē iho rānei o te uru atu o te tūkinotanga ki roto i ō tātou awa wai, e ngā mea whakakapi? Translation: Do the proposed standards for water quality in the Clean Water package allow more pollution or less to enter our waterways than the ones they will replace? BRETT HUDSON to the Minister of Finance: How much is the Government committing to spend on infrastructure over the next 4 years? ANDREW LITTLE to the Prime Minister: Given his predecessor told the Pike River families, “I’m here to give you absolute reassurance we’re committed to getting the boys out, and nothing’s going to change that”, when, if ever, will he be announcing the re-entry of the drift? STUART SMITH to the Minister of Transport: What announcements has he made recently regarding the Government’s commitment to reinstate key transport links following the Kaikōura earthquake? JACINDA ARDERN to the Minister for Children: When was she first notified that the Ministry for Vulnerable Children Oranga Tamariki, or its predecessor CYF, were placing children and younger persons in a hotel or motel for short-term care without a supervisor, and what was her first action, if any? MELISSA LEE to the Minister of Health: Can he confirm that 55,000 care and support workers will share in the $2 billion pay equity settlement announced on 18 April 2017? GRANT ROBERTSON to the Minister of Finance: Does he agree with the Dominion Post editorial that his Government has “singularly failed to answer the pressures of Auckland”; if not, why does he think they would write this? ANDREW BAYLY to the Minister for Building and Construction: How do the latest reports on the level of building activity in Auckland and nationwide for the month, quarter, and year compare with 2016? Rt Hon WINSTON PETERS to the Prime Minister: Does he stand by all his statements; if so, how? PHIL TWYFORD to the Minister of Transport: Why has the completion of the $2.4 billion Western Ring Route been delayed, and when can Aucklanders expect the new motorway to be open? EUGENIE SAGE to the Minister of Conservation: Is it Government policy to increase the logging of native forests on West Coast conservation land? Dr MEGAN WOODS to the Minister supporting Greater Christchurch Regeneration: Does she agree that the first homes in the East Frame will be completed 5 months ahead of schedule? Questions to Members CLARE CURRAN to the Chairperson of the Commerce Committee: Does she intend to call for further submissions on the petition of Dame Fiona Kidman before it is reported back to the House, in light of the recently released footage shot inside the drift of the Pike River mine?
In September 2010 and February 2011, the Canterbury region experienced devastating earthquakes with an estimated economic cost of over NZ$40 billion (Parker and Steenkamp, 2012; Timar et al., 2014; Potter et al., 2015). The insurance market played an important role in rebuilding the Canterbury region after the earthquakes. Homeowners, insurance and reinsurance markets and New Zealand government agencies faced a difficult task to manage the rebuild process. From an empirical and theoretic research viewpoint, the Christchurch disaster calls for an assessment of how the insurance market deals with such disasters in the future. Previous studies have investigated market responses to losses in global catastrophes by focusing on the insurance supply-side. This study investigates both demand-side and supply-side insurance market responses to the Christchurch earthquakes. Despite the fact that New Zealand is prone to seismic activities, there are scant previous studies in the area of earthquake insurance. This study does offer a unique opportunity to examine and document the New Zealand insurance market response to catastrophe risk, providing results critical for understanding market responses after major loss events in general. A review of previous studies shows higher premiums suppress demand, but how higher premiums and a higher probability of risk affect demand is still largely unknown. According to previous studies, the supply of disaster coverage is curtailed unless the market is subsidised, however, there is still unsettled discussion on why demand decreases with time from the previous disaster even when the supply of coverage is subsidised by the government. Natural disaster risks pose a set of challenges for insurance market players because of substantial ambiguity associated with the probability of such events occurring and high spatial correlation of catastrophe losses. Private insurance market inefficiencies due to high premiums and spatially concentrated risks calls for government intervention in the provision of natural disaster insurance to avert situations of noninsurance and underinsurance. Political economy considerations make it more likely for government support to be called for if many people are uninsured than if few people are uninsured. However, emergency assistance for property owners after catastrophe events can encourage most property owners to not buy insurance against natural disaster and develop adverse selection behaviour, generating larger future risks for homeowners and governments. On the demand-side, this study has developed an intertemporal model to examine how demand for insurance changes post-catastrophe, and how to model it theoretically. In this intertemporal model, insurance can be sought in two sequential periods of time, and at the second period, it is known whether or not a loss event happened in period one. The results show that period one demand for insurance increases relative to the standard single period model when the second period is taken into consideration, period two insurance demand is higher post-loss, higher than both the period one demand and the period two demand without a period one loss. To investigate policyholders experience from the demand-side perspective, a total of 1600 survey questionnaires were administered, and responses from 254 participants received representing a 16 percent response rate. Survey data was gathered from four institutions in Canterbury and is probably not representative of the entire population. The results of the survey show that the change from full replacement value policy to nominated replacement value policy is a key determinant of the direction of change in the level of insurance coverage after the earthquakes. The earthquakes also highlighted the plight of those who were underinsured, prompting policyholders to update their insurance coverage to reflect the estimated cost of re-building their property. The survey has added further evidence to the existing literature, such as those who have had a recent experience with disaster loss report increased risk perception if a similar event happens in future with females reporting a higher risk perception than males. Of the demographic variables, only gender has a relationship with changes in household cover. On the supply-side, this study has built a risk-based pricing model suitable to generate a competitive premium rate for natural disaster insurance cover. Using illustrative data from the Christchurch Red-zone suburbs, the model generates competitive premium rates for catastrophe risk. When the proposed model incorporates the new RMS high-definition New Zealand Earthquake Model, for example, insurers can find the model useful to identify losses at a granular level so as to calculate the competitive premium. This study observes that the key to the success of the New Zealand dual insurance system despite the high prevalence of catastrophe losses are; firstly the EQC’s flat-rate pricing structure keeps private insurance premiums affordable and very high nationwide homeowner take-up rates of natural disaster insurance. Secondly, private insurers and the EQC have an elaborate reinsurance arrangement in place. By efficiently transferring risk to the reinsurer, the cost of writing primary insurance is considerably reduced ultimately expanding primary insurance capacity and supply of insurance coverage.
